An investor currently holds the following portfolio: Amount Invested 8,000 shares of Stock A $16,000 Beta = 1.3 15,000 shares of Stock B $48,000 Beta 1.8 25,000 shares of Stock C $96,000 Beta 2.2 If the risk-free rate of return is 0.060 and the market risk premium is 0.042, then the required return on the portfolio is Instruction: Type your answer as a decimal, and round to three decimal places. E.g., if your answer is 0.0106465 or 1.06465%, should type ONLY the number .011, neither 0.0106465, 0.0106, nor 1.065. Otherwise, Blackboard will treat it as a wrong answer.
An investor currently holds the following portfolio: Amount Invested 8,000 shares of Stock A $16,000 Beta = 1.3 15,000 shares of Stock B $48,000 Beta 1.8 25,000 shares of Stock C $96,000 Beta 2.2 If the risk-free rate of return is 0.060 and the market risk premium is 0.042, then the required return on the portfolio is Instruction: Type your answer as a decimal, and round to three decimal places. E.g., if your answer is 0.0106465 or 1.06465%, should type ONLY the number .011, neither 0.0106465, 0.0106, nor 1.065. Otherwise, Blackboard will treat it as a wrong answer.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
None
![An investor currently holds the following portfolio:
Amount
Invested
8,000 shares of Stock A
$16,000
Beta = 1.3
15,000 shares of Stock B
$48,000
Beta
1.8
25,000 shares of Stock C
$96,000
Beta 2.2
If the risk-free rate of return is 0.060 and the market risk premium is 0.042, then the required return on the
portfolio is
Instruction: Type your answer as a decimal, and round to three decimal places. E.g., if your answer
is 0.0106465 or 1.06465%, should type ONLY the number .011, neither 0.0106465, 0.0106, nor 1.065.
Otherwise, Blackboard will treat it as a wrong answer.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7df80ab4-718a-4c35-abd0-2ac187a97f9c%2F64988910-a8dc-432c-8c64-c335a763552e%2Fppzwxcl_processed.png&w=3840&q=75)
Transcribed Image Text:An investor currently holds the following portfolio:
Amount
Invested
8,000 shares of Stock A
$16,000
Beta = 1.3
15,000 shares of Stock B
$48,000
Beta
1.8
25,000 shares of Stock C
$96,000
Beta 2.2
If the risk-free rate of return is 0.060 and the market risk premium is 0.042, then the required return on the
portfolio is
Instruction: Type your answer as a decimal, and round to three decimal places. E.g., if your answer
is 0.0106465 or 1.06465%, should type ONLY the number .011, neither 0.0106465, 0.0106, nor 1.065.
Otherwise, Blackboard will treat it as a wrong answer.
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Recommended textbooks for you
![Essentials Of Investments](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781260013924/9781260013924_smallCoverImage.jpg)
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
![FUNDAMENTALS OF CORPORATE FINANCE](https://www.bartleby.com/isbn_cover_images/9781260013962/9781260013962_smallCoverImage.gif)
![Financial Management: Theory & Practice](https://www.bartleby.com/isbn_cover_images/9781337909730/9781337909730_smallCoverImage.gif)
![Essentials Of Investments](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781260013924/9781260013924_smallCoverImage.jpg)
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
![FUNDAMENTALS OF CORPORATE FINANCE](https://www.bartleby.com/isbn_cover_images/9781260013962/9781260013962_smallCoverImage.gif)
![Financial Management: Theory & Practice](https://www.bartleby.com/isbn_cover_images/9781337909730/9781337909730_smallCoverImage.gif)
![Foundations Of Finance](https://www.bartleby.com/isbn_cover_images/9780134897264/9780134897264_smallCoverImage.gif)
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
![Fundamentals of Financial Management (MindTap Cou…](https://www.bartleby.com/isbn_cover_images/9781337395250/9781337395250_smallCoverImage.gif)
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
![Corporate Finance (The Mcgraw-hill/Irwin Series i…](https://www.bartleby.com/isbn_cover_images/9780077861759/9780077861759_smallCoverImage.gif)
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education